Is Your Mid Sized Business Making This Critical Mistake? [And How to Fix It]

What is the critical mistake mid-sized businesses make?

1. They Don't Invest in the Right Tech

The technology world is ever-evolving and it is important for mid-sized businesses to keep up with the changes in order to remain competitive. However, choosing the right technology for such businesses can be a daunting task, as there are a variety of options and features to consider. To make the best decision, one must identify their needs and evaluate the potential solutions.

One of the most common mistakes mid-sized businesses make is not having a clear goal and direction. Without this, it can be difficult to know which technology will best meet their needs. Additionally, many businesses are too hands-on, which can bottleneck growth and success. It is important to outsource to those with more experience in areas where one is not knowledgeable, as this can save time and money.

Project planning and communication is also a key factor when it comes to successful implementation of technology. Tangled, lengthy email threads, missed deadlines, and disagreements between team members can all slow down performance. To prevent this, it is important to have a well-structured plan in place, with explicit goals and timelines. All files should be kept in a central location and should be easily accessible.

Finally, data-driven decisions are essential in order to make the best possible decision regarding technology. Without accurate data, it can be difficult to make informed choices. Mid-sized businesses should look into data analytics software to help them make the best decisions and maximize the efficiency of the business.

In conclusion, mid-sized businesses should make sure to identify their needs and evaluate potential solutions accordingly. It is important to have a clear goal and direction, outsource to those with more experience, have a well-structured plan, and make data-driven decisions. By doing so, mid-sized businesses can ensure that they are utilizing the right technology for their needs.

How does this mistake affect your business?

1. The Mid Sized Business is Not Resilient to External Changes

When external changes occur, mid-sized businesses often fare worse than smaller businesses. This is due to their more complex decision-making processes and the stress that these processes can cause. The Treasure Data report found that 77% of mid-sized business leaders feel more pressure to make the right decisions quickly, compared to 61% of leaders at smaller businesses. Furthermore, 65% of mid-sized businesses frequently make the wrong decisions, as opposed to 54% at smaller businesses. This can lead to mistakes that can have costly consequences, and to a lack of confidence in making good business decisions. To counter this, mid-sized businesses should focus on increasing urgency, communicating potential revenue drops, and making sure that everyone is on board with the changes. Additionally, they should accept help from others who may have more experience in a certain area.

2. The Mid Sized Business does Not Remain Competitive in the Long Term

Not remaining competitive has a significant effect on the midsized business. By not elevating customer experience, investing in automation, protecting against cyber risk, or using insights to make good decisions – the business is decreasing value and eliminating any value-based differentiation. This means that when change happens, the business is not able to adapt, leading to diminishing returns and floundering sales. This also devalues the market and sector in which the business operates, as there are many low-value players in the market, making it hard to extract value from that market. Bigger, more established businesses can also step in and offer the incremental value, leading to a competitive disadvantage. If the business doesn’t put in the effort to understand what customers want and create a unique customer value proposition, they will have difficulty growing and scaling, leading to business failure. It is therefore important for midsized businesses to remain competitive to ensure their long-term success.

3. The Mid Sized Business loses Value (and Valuation)

When a mid-sized business loses value, it can have a significant impact on the business and its valuation. The value of the business is based on financial performance, industry averages, and comparable sales, and when the value of the business drops, the overall worth of the company can decrease significantly. This can lead to a lower valuation when the business is being sold, making it more difficult to recoup the investment from the years of hard work put in. Additionally, a sudden drop in value can be a red flag for potential investors, leading to a loss of buyer confidence and an inability for the seller to get the asking price they were hoping for. Overall, it is important for business owners to pay close attention to the value of their business and be prepared to act quickly if they see a dramatic decrease in value.

What steps you can take to fix this mistake

Step 1: Set clear goals on what you want tech to achieve.

Setting clear goals can help to fix this mistake with tech goals by providing a framework that allows small business owners to ensure their ideas are achievable and can be attained within a certain period of time. By using the SMART goal framework, it allows individuals to create specific, measurable, attainable, realistic, and time-bound goals that can be used to focus efforts and track progress. Additionally, it can help small business owners identify issues that may be causing them to not reach their goals, such as an unclear target audience or confusing brand messaging, as well as adjust their perspective to align with the circumstances they face. This will help them create specific solutions, engage with all relevant parties, and execute on their decision with the help of their team. By having clear goals and objectives, small business owners will be better equipped to make the right decisions, create effective solutions, and reach their goals.

Step 2: Get the right people to build a technology strategy.

Begin by assessing the company's competitive situation, market position, technological trends, and financial performance. Focus on potential revenue drops when patents expire, five-year trends in declining margins, and emerging markets.

Communicate this information broadly and dramatically, especially with respect to potential crises or great opportunities. This will help motivate people to cooperate with the transformation program.

Promote or hire real leaders into senior-level jobs. This is especially important if the target of the change is the entire company.

Use bad business performance to your advantage. Unpleasant facts about competition, shrinking margins, or lack of revenue growth should be discussed in a frank manner.

Consider bringing in outsiders such as consultants or fractional executives to bring valuable insights and help set direction.

If possible, engineer a crisis to create pressure from external stakeholders. This can help motivate people to take action and make changes.

Step 3: Build a roadmap of prioritized investments that help meet your goals.

Start by articulating the end goal. It should be specific, measurable, achievable, relevant, and time-bound (SMART). Consider the one-month, six-month, twelve-month, two-year, and five-year goals for your business.

Analyze the unique situation. Put the information you gathered into context and adjust your perspective to align with the circumstances you face. Examine the more granular situation. Engage with all relevant parties.

Analyze the unique situation. Put the information you gathered into context and adjust your perspective to align with the circumstances you face. Examine the more granular situation. Engage with all relevant parties.

Identify potential catalysts, influencers, and outcomes relevant to the end goal. Ask questions such as: What catalyst created the need for a decision to be made? Who are the influencers of this decision? What is the intended outcome? Why is this outcome important – or not?

Identify potential catalysts, influencers, and outcomes relevant to the end goal. Ask questions such as: What catalyst created the need for a decision to be made? Who are the influencers of this decision? What is the intended outcome? Why is this outcome important – or not?

Develop a vision that takes all of the elements into account. This should be a picture of the future that is relatively easy to communicate and appeals to customers, stockholders, and employees.

Create a strategy for achieving the vision. Consider how the reengineering project in the accounting department, the new 360-degree performance appraisal from the human resources department, the plant's quality program, and the cultural change project in the sales force all fit into the overall strategy.

Build a roadmap for investing in the projects and initiatives that will help bring the vision to life. Prioritize the investments based on their potential to contribute to the goals, timelines, budget, and resources available.

Work with your team to execute the plan. Make sure the next steps are clear and that everyone understands the plan and is on board.

Monitor progress and make adjustments as needed. Evaluate the results and adjust the plan as needed to keep the organization on track.

Step 4: Over time build internal expertise and skills to execute on the plan.

Educate Your Team: Every member of your sales team should be thoroughly educated on what your company does, the particulars of your products or services, and all other facets of the organization. That way, when a potential client has a question, they can provide a comprehensive and accurate answer.

Analyze and Understand the Situation: Put the information gathered into context and adjust your perspective to align with the circumstances you face. Examine the more granular situation, engage with all relevant parties, and ask questions to understand the catalyst that created the need for the decision, who the influencers are and what the intended outcome should be.

Deploy the OODA Loop: Use the OODA loop as a framework to guide decision-making and help ensure more timely and effective decisions.

Create Motivation: Create motivation and energy around the change process by focusing on potential revenue drops, five-year trends in declining margins, or emerging markets. Communicate this information broadly and dramatically to get the transformation program off the ground and gain the cooperation of all relevant parties.

Monitor Progress: Monitor progress regularly to ensure efficient execution of the plan and that everyone is aligned in the same direction. Regularly assess the performance of each team member and provide feedback and coaching to keep them on track.

Written By : Vyom Upadhya

Vyom Upadhya brings over 20 years of technology leadership experience with Fortune 500 and Top 10 PE-backed firms in industries such as telecom, healthcare, energy, and real estate. As a seasoned fractional CTO, Vyom has a proven track record of co-creating successful business and technology strategies, building high-performance teams and culture, and leading digital transformation and technology scaling initiatives for mid-sized enterprises.